i3 Consulting
Insurance
Insurance

The Insurance industry is one of the most analytically run businesses that ensure pooling of risks not only results in loss coverage for an unfortunate few, but also results in risk intermediaries making profits out of the business. At i3C, we bring our global experience and implementation of leading practices for driving profitable growth for business.

Be it developing a long-term strategy for business or management of customer lifetime value to new product launch, i3C works closely with its clients in delivering substantial and sustainable improvement in their performance. Our team of experts provides advisory services on majority of areas in Life Insurance, General Insurance, Reinsurance related modeling.

Some of the areas that we help our insurance clients with are:

  • Sales and Marketing
  • Risk Management

Insurance market is facing a fierce competition globally. Delivering optimal results by making an organization market centric has become the theme that majority of the insurance companies try to optimize. i3C with its proven expertise in managing similar situations helps insurance companies in the following areas:

Market Strategy

For developing any successful market strategy, an insurance company will need to understand the market and its customers better. Our team has experience of working with companies in developing fact-based strategy. Our team has consistently received accolades from the clients by providing them cutting-edge insights and then converting them into a sustainable market strategy for the company.

New Product Design

The ever evolving consumer needs, new consumer segments, changing environment necessitates insurance companies to identify new and innovative ways of addressing consumer needs through new product development. Our marketing analytics experts use the consumer insights, apply advanced analytical techniques like conjoint analysis, consumer segmentation etc., and work along with the client understanding the unsatisfied needs of the customers and convert them into the design of a new product.

Customer Value Management

Customer remains the reason for the company to exist. The business growth and profitability is centered on effective strategies of customer lifecycle management (CLM) and derive maximum value for itself. Our advisory to our clients is driven by our understanding of business fundamentals of evolving insurance needs with customer lifecycle stages along with actionable insights derived from mining customers’ data.

Sales and Distribution

Our team of analytics experts can help our clients collaborate better with their channel partners and help them better penetrate insurance products amongst their customer base. Our knowledge of developing bancassurance cross sell models coupled with experience of working with scarce data to generate customers’ insights helps the insurance companies grow faster at a minimal cost.

Customer Experience Management

Customer experience remains the cornerstone of any successful company. It is only satisfied customers that make a company sustain itself and grow. With insurance companies having renewed focus on customer experience, we help in assessing all the drivers that can bring customer delight and then work along with the client in achieving those. It could entail any specific program like process redesign of underwriting / claims processing, sales force stimulation or product redesign. Objective of this exercise will always have a clear focus of profitably providing consistent consumer delight at every touch point of the insurance company.

Optimize Marketing Mix

Every company spends millions of dollars on executing ATL and BTL campaigns. One of the questions that always crosses the mind of a business manager is – “I have spent so much money doing this campaign, what has this resulted in as far as my business is concerned”. We try to demystify this exact notion through our tool kit of marketing mix. Our approach combines traditional market research with some of the advanced analytical applications to provide deep insights to our clients. We also create market mix optimizers for our clients that provide optimal marketing mix for any marketing objective. This ensures institutionalization of capability that we develop along with our clients in a short period of time.

Insurance industry is so sensitive to risk of its customers that any unforeseen event can easily destabilize the sustainability of a company and can threaten its survival. It is hence imperative to understand the nature of risk before underwriting. It also needs to cede risk that ensures profitability for the company while maintaining solvency in business. Our risk management experts work closely with our client teams to make the organizational practices world-class in the following areas:

Market Strategy

For developing any successful market strategy, an insurance company will need to understand the market and its customers better. Our team has experience of working with companies in developing fact-based strategy. Our team has consistently received accolades from the clients by providing them cutting-edge insights and then converting them into a sustainable market strategy for the company.

  • The focus of managing customer lifecycle is to assess and maximize the profitability of the portfolio.
  • Develop underwriting models for various lines of business
  • Develop pricing models for various lines of business
  • Redesign process and provide IT enablers for quick decision making

Risk strategy and capital optimization

We help our clients in optimizing risk adjusted returns on their capital by identifying key drivers that could be used to maximize returns. We provide analysis of impacts of change in key drivers such as risk appetite, capital level, reassurance, ALM and asset allocation. Our models enable estimation of probability of various events and are used to arrive at optimal capital planning.

We work with insurance companies to make them better understand the risk classes and overall portfolio risk. i3 Consulting also builds models to identify risk classes that will have maximum fat tail and will be worth reinsuring. Quantifying the reduction in economic capital requirement by reinsuring risk classes is also provided along with identification of right price for purchasing reinsurance. Our engagement will help you in better understanding and management of economic capital.

Enterprise risk management

Enterprise Risk Management is a concept which is applicable across industries and more so for an insurance set-up which assumes the responsibility of a risk control function in a corporate function. We help our insurance clients define the maximum acceptable risk in terms of statements of risk appetite at the organization level and specific departmental level key risk indicators and help create dashboards for regular measurement and monitoring of the indicators. We work with our clients in defining and implementing ERM framework starting from risk governance to risk reporting and dashboarding addressing all the risk components as per the latest COSO standard. We have also helped our clients run stress scenarios to assess the impact of certain key business drivers in regulator rations such as solvency ratio or let loss ratio or other business or regulatory dimensions. We conduct risk assessment and help clients better understand their risk profile to devise mitigation strategies.

Fraud risk management

One of the challenges faced by the insurance companies is fraudulent claims. They not only increase the cost of claims processing, they also result in dissatisfaction of the customers in terms of increased processing time. Our team of professionals have experience of developing a sound strategy of managing fraudulent claims. The strategies developed can be coded onto IT systems to achieve automation and further the benefits of optimized fraud management.

Risk analytics

Risk management is very important for insurance industry as they themselves take over risks from customers. Every quantifiable factor is therefore an important tool which can be used to develop profiles of high and low insurance risk which determine insurance premiums and hence the business generated while covering acceptable amount of risks.

i3 Consulting helps its clients introduce more scientific approaches in overall underwriting process. Our solution incorporates combination of data mining and predictive and behavioral models to assess frequency and severity of claims. We use clustering, regression modeling and decision trees to predict frequency and value of claims to identify risk associated and potential payouts.

The business benefits by obtaining improved risk-adequate pricing of individual loans, avoiding adverse selection and provides guideline on business expansion without risking profits. We provide automation of operational decisions which improves quality as well as reduces costs.

We also assist our clients with our analytical capability for efficient and correct claim processing and also for product development.

Analytics help identify potential fraudulent claims like up coding, unbundling, double billing, false billing and overstated claims. We profile the client’s fraudulent claims and use historical data to predict potential fraudulent claims. These claims can then be scrutinized in greater detail providing our clients with effective focus.

The analytics can also be used to assess performance of field agents / surveyors on various KPIs such as time and volume through easy to use dashboards. These results can be used to define optimal process time and flow.

Our product development analytics help assess the risk based on the features designed in the new product developed through various methodologies i.e. statistics, simulation etc. We take advantage of our deep statistical expertise to provide specificities of risk and pricing that help shape products.

Insurance – Data Management

Data becomes the corner stone of any sound analytical program. Imagine ease of a salesman if he exactly knows the individual’s need while selling or the ease of a risk manager to underwrite an individual’s application if he has good clarity on risk. All of this can be achieved by developing sound databases that have clean, standardized and validated data that businesses can use with ease and confidence. Our data management experts help across the lifecycle of data management – i.e. ways of creating base cleansed and deduplicated customer databases to a sound risk data mart that can be used to run different analysis.

IFRS 17

The objective of IFRS 17 is to ensure that Insurance companies provide relevant information that faithfully represents insurance contracts. It focuses on establishing principles which lead to more objectivity in measurement and disclosure. IFRS 17 has far reaching impact not just on the technical calculations but also on other aspects of the Business including, Actuarial, Finance, Tax, Information Technology, Human Resource and last but not the least Financial Performance.

i3 Consulting is working with its insurance clients to help adopt IFRS 17 regulation with a January 2022 go live in the areas of gap analysis and implementation roadmap, impact assessment and implementation.

Gap Analysis and Implementation Roadmap

  • Identifying key areas of impact due to IFRS 17 adoption
  • Comprehensive assessment of the existing process, systems, data and methodologies in key areas with respect to the requirements of the accounting standard
  • Identify the gaps in the current practices for complying with the accounting standard
  • Based on gaps identified conducting discussions with key stakeholders to devise a detailed implementation roadmap and project plan

Impact Assessment

  • Identify the key drivers of the revised accounting standards
  • Agree on key assumptions for estimation for conducting the impact study
  • Extracting data required from source systems for carrying out calculations
  • Performing CSM calculations, measuring insurance liabilities as per new standard
  • Conduct sensitivity analysis to arrive at a range of outcomes
  • Identify qualitative aspects of impact through discussions

Implementation

  • Conducting business workshops for understanding requirements
  • Design and implementation of controls over financial reporting and new business processes as a result of the introduction of IFRS 17
  • Designing new policy frameworks, methodologies and governance structures
  • Designing, developing, testing and deploying the proposed solution
  • Training workshops for educating about various functionalities of the solution
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